The average price of a home in England and Wales has gone above £300,000 with a strong start to 2017 seeing a new peak in values, according to the latest index to be published.
Prices were up 0.3% in January to an average of £300,169, an annual rise of 3.1% but the market in London is dragging values down as the annual rise is 3.7% when the capital is excluded from the calculation.
The LSL Property Services/Acadata index also show that growth was led by Barking and Dagenham in London with a rise of 13.6% and the East of England with growth of 7.1%.
It is the first fresh peak in the housing market since March last year and it mean that prices in January were almost £10,000 higher than in the same month in 2016, when the average was £291,165.
Prices have now doubled since they topped £150,000 in November 2002 despite the slump following the financial crisis and activity in January was also higher than usual for the time of year, with 60,000 transactions. This was lower than the 62,059 in January 2016, which also started strongly, but up by more than 2,000 on 2015.
‘It’s been a confident start to the year from the housing market. Following a strong December, the performance in January shows a market whose resilience continues to defy the doubters,’ said Oliver Blake, managing director, Your Move and Reeds Rains estate agents.
He pointed out that London also had a good December, with prices growing 0.3%, the same as the national average for that month. For the first time in nine months, average prices have risen in the capital, with prices for the year finishing up 1.3%, with the average home in London costing £598,001.
Blake explained that this has been largely the result of strong growth in cheaper areas as buyers search for value or affordability. Barking and Dagenham, where average prices of £301,572 are almost half the London average, saw prices rise 13.6% annually.
Waltham Forest and Redbridge, again with prices well below average, also saw double digit growth of 11.3% and 10.8%, respectively. The 13 cheapest boroughs in London all saw growth in prices and there are also some tentative signs of a recovery at the top end of the market.
Of the top five most expensive London boroughs at the end of 2016, Wandsworth saw an annual rise of 3.3% and the most expensive borough, Kensington and Chelsea, saw a rise annually of 2.7%. The report says that this was largely as a result of an exceptionally strong December, where average prices increased 6.3% which was the biggest increase in London over the month.
The biggest fall over the month was in the City of London with prices dropping 10% in December to finish down 20.2% on the same time last year. However, a strong finish to the year means that London rises off the bottom of the table for house price growth over 2016.
Now at the bottom is the North East with prices dropping 0.3% in December to finish effectively flat over the last 12 months. Every other region of the country has seen prices grow in the last year, led by the East of England where the average price edged up a further 0.1% in the month to finish 7.1% up on last December. The region was supported by strong growth in the last year in Luton, up 10.1%, Thurrock up 11% and Southend-on-Sea up 14.7%, which also saw among the strongest monthly growth at 2.9%.
Other top performing regions included the South East, increasing 4.9% annually with double digit growth in Medway and Portsmouth; and the East Midlands, where Rutland saw growth of 12.4% over the year and the region as a whole increased by 4.5%.
The strongest annual growth in a unitary authority, however, was in Kingston upon Hull, 2017 City of Culture. Prices in Hull grew 1.5% in December to finish up 16.8% on the year, with the average house price rising by £19,072 to £132,590. That performance wasn’t matched by Yorkshire and Humber as prices in the region grew just 2.3% over the year.
